Top Plaintiffs' Verdicts by Dollar - Union Pacific Railroad Co. v. Santa Fe Pacific Pipelines

At issue was a highly complex and detailed analysis of how best to determine rent - and the total rental value thereof - for 1,850 miles of pipeline easements on Union Pacific Railroad Co.'s right of way property.

The result: a whopping $100.9 million judgment for the railroad.

Union Pacific claimed that the annual fair market rent as of 2004 was $19 million, based on the industry standard "across the fence" appraisal methodology used.

But the defendants, Santa Fe Pacific Pipelines, argued that fair market rent was $7 million, based on a "multiple regression" analysis of prices paid for other easements. Union Pacific Railroad Co. v. Santa Fe Pacific Pipelines, BC319170 (L.A. Super. Ct., filed July 2004).

The court rejected the defendants' theory, resulting in a judgment for $81 million in back-due rent and $19 million in prejudgment interest.

Thomas F. Winfield III, lead plaintiff's attorney from McKenna Long & Aldridge LLP, said that over the years a helpful tool in the case was the increasingly sophisticated technology that became available, such as Google Earth, to show what the right of way looked like over time.

Also tapped, said McKenna Long plaintiff attorney Michael H. Wallenstein, were experienced corridor property appraisers and a rebuttal statistics expert "who was able to debunk the sophisticated math inherent in the multiple regression analysis and demonstrated that the testimony put forward by defendants' experts was significantly flawed."

With very little case law to work with, Wallenstein said, the dispute led to a thorough vetting of the across-the-fence appraisal methodology, adding, "This was a thorough vindication and judicial endorsement of that."

- PAT BRODERICK

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